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Taibbi on "Bailout": Barofsky's Adventures in Washington, D.C.

Taibbi on "Bailout": Barofsky's Adventures in Washington, D.C.

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Published by William J Greenberg

Bailout has its first paperback release this week, and Barofsky accordingly is making the media rounds (check out Comedy Central tomorrow), where he'll mainly be asked about the political revelations in the book. You know, the inside-baseball stories of how the officials who administered the TARP bailout fought transparency at every turn, failed to do due diligence on the health and viability of bailout recipients, seemed totally uninterested in creating safeguards against fraud, and generally speaking spent more time bitching about the media and plotting against the likes of Elizabeth Warren and, eventually, Barofsky himself than making sure the largest federal rescue in history wasn't a complete waste of money.

Bailout has its first paperback release this week, and Barofsky accordingly is making the media rounds (check out Comedy Central tomorrow), where he'll mainly be asked about the political revelations in the book. You know, the inside-baseball stories of how the officials who administered the TARP bailout fought transparency at every turn, failed to do due diligence on the health and viability of bailout recipients, seemed totally uninterested in creating safeguards against fraud, and generally speaking spent more time bitching about the media and plotting against the likes of Elizabeth Warren and, eventually, Barofsky himself than making sure the largest federal rescue in history wasn't a complete waste of money.

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Published by: William J Greenberg on Feb 11, 2013
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09/17/2013

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Rolling Stone Journalist Matt Taibbi. (photo: HBO)
'Bailout': Barofsky's Adventures inGroupthink City
By Matt Taibbi, Rolling Stone
07 February 13
 eil Barofsky isn't going to like this, but the first person I thought of when I readthe former TARP Inspector General's book,
 Bailout,
 
was G. Gordon Liddy. Not thathe has anything in common politically with Nixon's fanatical arm-roasting hatchetman, but after reading
 Bailout 
I had the same thought I had after reading Liddy'smemoir,
Will 
- that every now and then, a born writer ends up in some other, far moreinteresting profession, and we don't find out about it until he or she is forced for somereason to write a book.
 Bailout 
has its first paperback release this week, and Barofsky accordingly is makingthe media rounds (check out Comedy Central tomorrow), where he'll mainly be askedabout the political revelations in the book. You know, the inside-baseball stories of how the officials who administered the TARP bailout fought transparency at everyturn, failed to do due diligence on the health and viability of bailout recipients,seemed totally uninterested in creating safeguards against fraud, and generallyspeaking spent more time bitching about the media and plotting against the likes of Elizabeth Warren and, eventually, Barofsky himself than making sure the largestfederal rescue in history wasn't a complete waste of money.
 
As the former Special Inspector General of the TARP, a key official who was presentat the highest levels throughout most of the bailout period and saw from the insidehow both the Bush and Obama administrations attacked the economic collapse,Barofsky does have that story to tell, and the book unsurprisingly is full of historicallyweighty scenes and factoids that will be culled by reporters like me for years to come.But there's a secondary and I think more interesting subplot to this book, a personal
 
story that will give it more staying power. Just like
Will 
was really a journey-of-self-discovery story that just happened to have the Watergate burglary as a backdrop (the book's real climax comes in the post-Watergate prison years, whereLiddy really "finds himself"),
 Bailout 
is a kind of 
 Alice in Wonderland 
tale of anordinary, sane person disappearing down into a realm of hallucinatory dysfunction,with Tim Geithner playing the role of the Mad Hatter and Barofsky the increasinglyfrustrated Alice who realizes he's stuck at the stupidest tea party he ever was at.Though you would think it would be an angry book, Barofsky describes hisexperiences with a wry, anthropological detachment, almost in awe at these strangeand irrational characters who seem so obsessed with intramural squabbles and other irrelevancies (when the newly-appointed Barofsky asks for advice from the TreasuryDepartment's Inspector General, Eric Thorson, Thorson's
 first 
tip, delivered in totalseriousness, is to get an account at the Treasury Dining Room, where a presidentialappointee can get good food at cheap prices) while the world economy is meltingdown all around them.The book is full of morbidly funny scenes, like for instance when Barofsky describeshis inner trepidation in taking the oath of office on the extremely religious Hank Paulson's personal Bible:Paulson is famously a devout Christian Scientist and as I put my Jewish hand on thePaulson family Bible, I fleetingly pictured it bursting into flames . . .In that same surreal scene, Paulson, in his first meeting with Barofsky, rambles onabout the decisions he's faced with, including whether or not to use TARP funds torescue the auto industry. Barofsky listens politely, believing he's just accidentally present while an important official is thinking out loud, when suddenly Paulson looksat him. "So what do you think?" Paulson asks.This moment underscores the randomness that seems to have permeated a lot of  bailout policy. Barofsky realizes that Paulson is actually asking advice of a career criminal prosecutor - a man he's only just met, who knows nothing about the subject -on whether or not to bail out Detroit. "What do I think?" he wonders to himself. "I
 
think the only thing I know about the domestic automobile industry is that sweet '95Chevy Camaro I parked outside."Another section reads like something straight out of 
Goldilocks and the Three Bears
.Barofsky has it explained to him that an Inspector General shouldn't be too much of a"junkyard dog" ("You don't want to be seen as promoting yourself") and you don'twant to be a "lapdog," either (because Congress will get upset and drag you over thecoals if they find out you're playing golf with the people you're supposed to be policing). Instead, an IG should be porridge whose regulatory temperature is "justright" - a "watchdog," which in Washington parlance means you want Congress toknow you're doing something, but you don't want it to think that it owns you.Again, all of this advice Barofsky gets has nothing to do with what's best for, youknow, the actual country - maybe, in this circumstance, the country needed a"junkyard dog" in that spot, but that's not the way things are done inside the Beltway.According to the twisted logic of this place, your goal is to find a happy medium,where you don't anger too many of the people in the agency you're supposed to be policing, but you also don't go so soft on them that Congress crawls up your rear end.This is a persistent theme of the book: that Washington is a kind of upside-downworld where everyone is all the time frantic about some emergency or other - youcan't ever be sure what it is, exactly, except that it almost certainly isn't one of thereal-world problems the locals were hired to solve, like the loss of 5,000 points of Dow Jones value in a year or the awesome quantity of toxic/fraudulent loans infectingthe books of our major banking institutions. Instead, the characters Barofskyencounters seem to worry endlessly about one-upping each other, not rocking the boat, and avoiding looking like tools in the media and/or to their bosses.In an early chapter, Barofsky describes a major international drug prosecution againstthe FARC rebels in Colombia undertaken by the U.S. Attorney's office in theSouthern District of New York that gets undermined when the Washington office -apparently afraid that a regional office nailing a major South American cartel wouldmake the main office look like asleep-on-the-job twits - races frantically to preventindictments from being handed down before they can be put in nominal charge of thecase.In another scene, the Treasury IG, the aforementioned Thorson, scrambles to throwtogether a last-minute investigation of some schmuck bailout-recipient bank inBeverly Hills before Barofsky's SIGTARP office - which would take over oversightresponsibilities from Thorson- was up and running. Thorson conducts a review of the bank's receipt of bailout funds, then seemingly arranges to plant a question with alocal reporter about the investigation, which Thorson immediately says, in an email

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